6th Mar 2025 11:51
(Alliance News) - Stock prices in London were mostly lower at midday on Thursday, as the European Central Bank's interest rate decision fast approaches.
The ECB "is expected to cut rates having been given a freer hand as inflationary pressures have eased," AJ Bell's Russ Mould noted.
The FTSE 100 index was down 82.84 points, 1.0%, at 8,673.00. The FTSE 250 was down 33.31 points, 0.2%, at 20,094.42, and the AIM All-Share was up 0.22 points at 690.70.
The Cboe UK 100 was down 1.0% at 869.19, the Cboe UK 250 was down 0.2% at 17,496.45, and the Cboe Small Companies was up 0.3% at 15,574.20.
"The FTSE 100 slumped on Thursday despite mining stocks enjoying strong gains on hopes of a reprieve on tariffs and expectations China will launch a big stimulus package," Mould commented. "The UK's flagship index was dragged lower as several big names traded without the right to their next dividend and some corporate results disappointed.
"News that Donald Trump is temporarily sparing carmakers from US tariffs on Canada and Mexico helped reinforce hopes there may be some flexibility in the new administration's trade policy."
Schroders was the best-performing large cap, up 6.7%.
The UK's largest standalone asset manager kept its final and total dividends for 2024 unchanged at 15.0 pence and 21.5 pence respectively, and reported an increase in pretax profit to GBP558.1 million from GBP487.6 million.
It said it has generated GBP17.5 billion in gross inflows during the year to date, and expects to deliver GBP40 million in run-rate cost savings by the end of 2025.
Melrose remained the worst performer, down 11%.
Rentokil followed, down 5.5%.
The Crawley, England-based pest control company said pretax profit fell 19% to GBP405 million in 2024, although Rentokil increased the total dividend by 4.7% to 9.09p.
Revenue rose 1.1% to GBP5.44 billion. However, its North American business lagged behind with organic revenue growth of 1.5%.
The sluggish North American performance has continued into the first quarter, held back by continued weak lead generation. Nonetheless, Rentokil expects to achieve 2025 results in line with market expectations.
"You'd need a bottle of Vanish to clean up the messy set of results from Reckitt," remarked Mould. "There is certainly plenty for investors to unpick in the statement as the company continues along the restructuring path."
He continued: "A weak cold and flu season in the US was the main culprit but there may still be some concern about the strength of the core brands Reckitt is retaining...There may also be disappointment that Reckitt didn't have anything more definitive to say about an exit from its Mead Johnson infant formula arm.
"The USD18 billion capture of this business in 2017 has been a disaster of a deal and remains a source of litigation risk for the group."
RHI Magnesita, a Vienna-headquartered manufacturer of refractory products for the processing of steel, glass, and non-ferrous metals, led the FTSE 250 with a 11% rise.
Grafton was the second-best performer, gaining 5.7%.
The Dublin-based building materials distributor and DIY retailer announced a new share buyback programme worth up to GBP30 million.
Also, it increased the full-year dividend by 2.8% to 37.0p despite pretax profit falling 17% to GBP152.5 million while revenue decreased 1.6% to GBP2.28 billion. Adjusted operating profit decreased 14% to GBP177.5 million, but this was still slightly ahead of analysts' forecasts.
"Whilst the timing of recovery in certain geographies remains uncertain, the medium term outlook is positive," CEO Eric Born commented.
Spire Healthcare continued to lead the laggers, down 16%.
Adjusted earnings before interest, tax, depreciation and amortisation rose 11% to GBP260.0 million in 2024, but this was 2.9% below company compiled consensus of GBP267.6 million.
Spire also said in its annual report that it is guiding to 2025 adjusted Ebitda of GBP270 million to GBP285 million, 7.2% below at the mid-point compared with company compiled consensus of GBP297.8 million.
Harbour Energy was the second-worst performer, losing 11%.
This was despite an increased final dividend of 13.19 US cents per share, with pretax profit profit rising to USD1.22 billion from USD616 million and revenue rising to USD6.16 billion from USD3.72 billion.
It also forecast production of 450,000 to 475,000 barrels of oil equivalent per day for 2025, up by around 80% from in 2024.
Among small-caps, Kenmare Resources shot up 42%.
The Mozambique-focused producer of titanium minerals and zircon has received a non-binding proposal from Oryx Global Partners and Michael Carvill, together a consortium, for a potential all-cash takeover offer of 530p per share.
Kenmare shares had closed at 275.00p on Wednesday in London, meaning the proposal of 530p was a 93% premium.
Near the bottom end of AIM, Celsius Resources lost 14%.
The mine developer with projects in Africa and the Philippines said trading of its shares on the Australian Securities Exchange has been halted, effective immediately.
Celsius requested the halt "pending the release of an announcement in relation to a capital raise".
The UK in February experienced its fastest decline in construction output since May 2020, early in the Covid-19 pandemic, survey results published by S&P Global showed.
The S&P Global UK construction purchasing managers' index fell to 44.6 points in February from 48.1 in January, sharply underperforming FXStreet-cited market expectations of an uptick to 49.5.
However, S&P Global's Tim Moore added that companies "remain optimistic overall about their growth prospects for the next 12 months, albeit less so than on average in 2024 amid increasing concerns about the broader UK economic outlook".
Also, UK defence secretary John Healey will join his counterpart Pete Hegseth on Thursday for a bilateral meeting on a possible Ukraine peace plan while efforts continue to bridge a transatlantic rift over the country's future security.
They are expected to discuss the US decision to pause intelligence-sharing with Ukraine, as European leaders hold crisis talks in Brussels on support for Kyiv.
The intelligence-sharing suspension could affect Ukraine's ability to effectively use long-range western weapons, such as US-made Himars launchers and deprive Kyiv of advance information about potential incoming threats.
In European equities on Thursday, the CAC 40 in Paris was down 0.7%, while the DAX 40 in Frankfurt was up 0.2%.
The contraction in construction activity in the eurozone worsened in February, S&P Global reported.
The Hamburg Commercial Bank eurozone construction PMI total activity index deteriorated to 42.7 points in February from 45.4 in January. Notably, demand conditions at eurozone construction firms sharply weakened in February, although the pace of contraction eased slightly.
Also, eurozone retail sales fell by 0.3% monthly in January, after no change in both December and November, data published by Eurostat showed. This underperformed the FXStreet-cited consensus of 1.9% growth.
On-year growth in retail sales slowed to 1.5% in January from 2.2% in December, the latter upwardly revised from 1.9%.
Meanwhile, Germany's construction activity index worsened to 41.2 points in February from the 20-month high of 42.5 in January.
Tariq Chaudhry, an economist at HCOB, said: "The outlook remains deeply pessimistic. Order intake is falling sharply, and business prospects for the next twelve months, despite a significant increase from the previous month, remain in contraction.
The pound was quoted higher at USD1.2873 at midday on Thursday in London, compared to USD1.2863 at the equities close on Wednesday. The euro stood at USD1.0788, higher against USD1.0764. Against the yen, the dollar was trading lower at JPY147.87 compared to JPY148.58.
Stocks in New York were called lower. The Dow Jones Industrial Average was called down 1.0%, the S&P 500 index down 1.2%, and the Nasdaq Composite down 1.4%.
Brent oil was quoted higher at USD69.44 a barrel at midday in London on Thursday from USD68.38 late Wednesday.
Gold was quoted lower at USD2,903.91 an ounce against USD2,926.93.
Still to come on Thursday's economic calendar, there are multiple US releases including trade balance and initial jobless claims.
By Emma Curzon, Alliance News reporter
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